RADICAL overhauls of town hall financing and the way planning applications are handled have been proposed.

A Local Government Bill will give greater financial freedom to councils to borrow capital for major projects within "prudent limits".

Councils will be encouraged to work in partnership with businesses to improve run-down town centres and commercial areas through Business Improvement Districts.

They will fast-track developments in areas where jobs are particularly scarce.

One of the main aims is to cut red tape and give additional incentives to top performing councils, although details have yet to emerge.

Ken Manton, leader of Durham County Council, said "I welcome any moves to give us more financial freedom. We need to be reassured that the process to qualify for this will be transparent. We have always had to go through alot of hoops.

"The rules need to be transparent, and not made behind closed doors."

The Bill will aim to make council tax fairer, with properties to be revalued every ten years and creating extra council tax bands.

A small business rate relief scheme will also be introduced.

A Bill is proposed to speed up and simplify the planning process, and to make the compulsory purchase system simpler, fairer and quicker.

North Durham MP Kevan Jones said: "The challenge to local authorities is that they should be more effective. The proposals should ensure that their services are being delivered more fairly."